Retrospective procedural amendment cannot unsettle an already exercised compounded tax option where Form K returns were filed.

A dealer already paying tax under a compounded scheme and filing Form K returns was treated as having validly exercised the option for that scheme. The Madras High Court noted that the 2008 amendment introducing a fresh option requirement came into force midway through the financial year and could not be applied retrospectively to unsettle an arrangement already acted upon. On those facts, filing Form K was sufficient indication of the scheme option, so the attempt to shift the turnover to the regular rate was not sustained.

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Issues: Whether the dealer, who had already been paying tax under the compounded scheme and filing Form K returns, was required to file a fresh option within 30 days of the 2008 amendment and whether the amended requirement could be applied retrospectively to the assessment year 2008-09.

Analysis: The assessment had been made by shifting the turnover to the regular rate on the footing that the dealer had not exercised a fresh option after the amendment. The appellate authority and the Tribunal found that the dealer had been paying tax under the compounded scheme from the inception of the Act and continued to file Form K returns. The amendment introducing the new option requirement came into force in the middle of the financial year, and the authorities held that it could not be applied retrospectively so as to unsettle an arrangement already acted upon. Filing of Form K was treated as sufficient indication of the option to pay tax under the compounded scheme.

Conclusion: The requirement to file a fresh option did not arise on the facts, and the revision was dismissed in favour of the assessee.

Ratio Decidendi: An amendment imposing a fresh procedural requirement for opting into a concessional tax scheme cannot be applied retrospectively to a dealer who had already been paying tax under that scheme and complying with the prescribed return procedure.

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